Your Rights and Protections Under the Affordable Care Act (ACA)

6/13/2015

The Affordable Care Act (ACA) has provisions designed to protect you from abuses by insurance companies. The insurance industry was regulated by the government before the ACA, but the intent of the law is to take those protections even further by:

requiring insurance companies to provide a summary of your benefits in plain and simple language

allowing you to choose your doctor and use any emergency room

eliminating pre-existing conditions as a reason to deny coverage and raise premiums

eliminating annual andlifetime limits on coverage

outlawing the retroactive cancellation of insurance policies

providing a process for independent, third-party review of any claims denied by your insurance company

giving you the right to appeal coverage decisions by your insurance company

regulating how your premium is spent

Please read on for a more detailed explanation of each of these rights and protections.

Summary of Your Benefits

The ACA requires insurance companies, including those participating in the Health Insurance Marketplace, to provide a Summary of Benefits (SBC) and a Uniform Glossary of terms. The SBC is a description in plain and simple language of the benefits and coverage the plan provides. Together the SBC and Uniform Glossary can be used to compare plans because all the plans are required to use the same standard forms.

Click here to see a sample Summary of Benefits and here to see the Uniform Glossary. The SBC is required to be available from all plans, including grandfathered plans, or those job-based and individually purchased plans in effect before the ACA became law on March 23, 2010. The SBC may also be available in your native language.

Choose Your Doctor and Emergency Room

The ACA requires that insurance companies allow you to choose your doctor and your child’s pediatrician and to use any emergency room from your plan’s provider network. If you choose to use a provider outside of your network, you should not have to get approval first or pay a penalty, and the insurance company may not demand higher copayments or coinsurance. You also no longer need a referral for OB-GYN services. However, if you are covered by a grandfathered plan, you may not have the same choices.

Pre-Existing Conditions

What is a pre-existing condition? Dr. Peter L. Duffy, Director of the Cardiovascular Service Line at Reid Heart Cent/FirstHealth of the Carolinas in Pinehurst, North Carolina, explains.

According to a 2011 report from the Department of Health and Human Services, as many as 19 to 50 percent of Americans under age 65 have some type of pre-existing condition—a known medical condition that you have before you apply for insurance.

Because you’re visiting this site, it’s likely that you or someone you love has one of the most common pre-existing conditions—heart disease, which according to the American Heart Association affects one in every three adults. Before the ACA protections, a pre-existing condition such as a heart disease could have made it difficult to get coverage, cost you higher premiums, and in some cases led to loss of coverage.

Under the ACA, insurance companies can no longer limit or deny coverage for anyone, children or adults, based on pre-existing conditions and your premiums may not be higher than anyone else of the same age, sex, and location. That includes Medicaid and CHIP.

The exception to this rule is if you bought an individual plan for yourself that is grandfathered, which is a plan in place before the law changed. These plans are not required to cover pre-existing conditions, but it is important to check your plan’s documentation. Your plan may offer coverage of pre-existing conditions even though it is not required by law for grandfathered plans.

If your plan does not cover pre-existing conditions, you may want to consider buying a new plan from your state’s insurance exchange.

Annual and Lifetime Limits

Before the ACA, many plans limited the benefits that could be received both annually and over the course of the insured’s lifetime. These limits were potentially devastating for those who had to rely on their savings to cover the cost of expensive and in some cases, life-saving treatments.

To address this problem, the ACA eliminated lifetime limits for essential benefits for all plans, including grandfathered plans, that are job-based and individually purchased plans in effect before the ACA became law on March 23, 2010. At a minimum, essential health benefits include items and services within the following 10 categories:

If you have an individual plan - that is one you purchased directly from an insurance company - it is a good idea to check with your plan administrator to be certain that you understand any annual limits that may apply. If your plan is still subject to annual limits, you may want to consider changing coverage when you have the opportunity to renew or change your coverage.

Cancellation of Insurance Policy

Before the ACA, if your insurance company found a mistake in your application it could cancel your coverage and have you reimburse the company for money spent on your care.

Under the ACA, insurance companies can no longer retroactively cancel your insurance coverage unless you deliberately lie or omit information about your condition, symptoms, or treatment received, or fail to pay your premiums. This rule applies to all plans, including job-based and individually purchased grandfathered plans, that is, plans purchased before March 23, 2010.

If you or any other member of your family covered by the policy (for individual policies) or your employer (for group coverage) makes an honest mistake or omission on your application or other paperwork, such as a change in status (for example, divorce), it will no longer be grounds for cancellation as long as you have paid your premiums in full and on time. However, be aware that your coverage can be cancelled going forward if, for example, your employer realizes a mistake or oversight, such as an employee change in status from full- to part-time employment.

If an insurance company does decide to cancel your policy, they must give you at least 30 days notice to appeal or find other insurance.

Appealing Coverage Decisions

If your insurance company denies your claim for a treatment or service, the ACA requires that they tell you why the claim was denied and the process for appealing their decision. If you decide to appeal the decision, you would first ask your insurance company to review and reconsider its decision, which is called an internal appeal. If the company still denies your claim, they must notify you of your right to request an external review. An external review is done by an independent organization often referred to as a third party.

Internal appeals: Ask your insurance company to reconsider its decision to deny payment for a service or treatment. They are required to review it. If they deny it, they have to tell you why and that you have a right to file an internal appeal, and notify you of your right to request an external review if they still deny your claim and of a Consumer Assistance Program

External review: If the insurance company still won’t pay the claim, the law gives you the right to have an external review by a third party. A third party is an independent organization that will make the decision.

Rules regarding the number and levels of internal review may vary according where you live and the type of plan you have. And, grandfathered plans (plans purchased before March 23, 2010) are not subject to these same requirements.

You can find more information on how to file an appeal at Healthcare.gov

Regulating How Your Premium Is Spent

The ACA provides some protection from rapidly rising premiums and insurance companies that are using too much of your premium for their own purposes instead of providing and improving your healthcare coverage.

Rate review. The ACA requires that companies publicly justify any increase of 10 percent or more before raising premiums. This rule does not apply to grandfathered plans - that is, plans purchased before March 23, 2010.

80/20 rule. This rule, also known as the Medical Loss Ratio (MLR), requires that insurance companies spend at least 80 percent on “health care and quality improvement activities” instead of “administrative, overhead and marketing costs.” The rule bumps up to 85 percent for companies selling to large groups, which are usually considered 50 or more employees.

If your insurance company does not comply with the rule you will receive a:

Rebate check,

Lump-sum deposit to account used to pay premium (credit or debit card), or

Reduction in future premium

The 80/20 rule does not apply to insurance companies with fewer than 1,000 plan holders in certain states or markets, but it does apply to all individual, small group, and large group health plans, whether or not they are grandfathered.

These protections provided by the ACA are intended to help you and your family get affordable, quality care. Do not hesitate to ask questions and check with your plan administrator if you don’t understand something. You are paying for quality care and you expect to receive it.

Note: This website and the information contained, expressed or implied herein are made available solely for general informational purposes and are not intended to be legal, tax, health, medical or professional advice or the sole source of information about health insurance coverage or specific health plans. While every effort is made to ensure that this information is accurate and current, SCAI makes no guarantees and disclaims any expressed or implied warranty or representation about its accuracy, relevance, timeliness, completeness or appropriateness for a particular purpose.

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